How to Write a Rental Lease

Lawyer's Corner: Writing a Lease? Don't Forget the Fine Print

By Holly Johnson

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Writing a lease may seem like a straightforward task, but there is a great deal of legal fine print every landlord should be aware of. Real estate attorney Brian Locker sheds some light on what to include when writing a lease.

The ins and outs of owning a rental property are complicated. While tasks like home repairs and communicating with tenants may eventually become second-nature to landlords, many fall short when it comes to the legal aspects of property management.

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One area where this is especially true? The lease.

Generally, property owners write a lease that covers the bare minimum and assume this will ensure a worry-free landlord-tenant relationship. And while most landlords rely on skeleton leases from state websites, these aren't comprehensive documents. According to Brian Locker, real estate attorney at Mesa, Arizona-based law firm Fowler St. Clair, using a standard lease (without building upon it) can lead to legal trouble or financial disaster. 

Get Specific

Locker says lease trouble happens for landlords because they tend to overlook specific legalities when drafting a lease—things like late fees for unpaid rent, pet provisions, rental application details and maintenance responsibilities.

That said, lease provisions vary based on the location, tenant pool and type of rental, so each landlord should begin the lease-writing process by considering their specific situation. If the rental sits squarely in a college town, for example, it might be wise to beef up language on damage fees and early lease termination penalties.

Remember, there is no word limit on a lease and there are no punishments for protecting an investment property with a lengthy legal document.

Here are commonly-missed details for every landlord to consider:

The Fine Print: What to Include in a Lease

  • Fees: Locker says failure to identify all fees—like lost key fees, additional tenant fees, damage fees, cleaning fees, pet fees or rental application fees—allows the lessee to ignore them (and often not pay them). Be sure to include a description of each fee in the lease, otherwise it will be much more difficult to collect on them.

  • Lack of definition: Details like naming the lessee and lessor in the document is a common misstep that can create misunderstanding when roommates move in or out, says Locker. To avoid a mess, describe each important term used in the lease, no matter how obvious they might seem. Some landlords even take it a step further and include a glossary of terms within the text of the lease.

  • Alternative dispute resolution clause: Including this clause saves landlords from frivolous lawsuits and will ensure that tenants go through mediation or arbitration before filing a lawsuit.

  • Provisions related to pets: Include appropriate charges for pet rent and an additional damage deposit. “Nothing causes post-tenancy costs on a home more frequently than pets," says Locker.

  • Clear statements regarding eviction and termination standards: “Don't have the lease automatically renew for consecutive one-year terms," says Locker. By allowing each lease to end on its own, landlords will be in the best position to renegotiate based on current rents and other factors.

Ultimately, each landlord has a responsibility to create or approve a lease that will clearly define each issue during the worst of times. To accomplish this goal, lean on professional expertise. The stakes are too high to simply wing it. As Locker notes, taking the easy way out can result in far more issues and costs than any landlord wants to deal with.

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About the Author:
Holly Johnson
Holly Johnson is a financial expert and award-winning writer who is obsessed with frugality, budgeting, and travel. In addition to serving as contributing editor for The Simple Dollar, Holly writes for well-known publications such as U.S. News and World Report Travel, Personal Capital, Lending Tree and Frugal Travel Guy.